WORLD TRADE  
ORGANIZATION   
G/SCM/Q2/KOR/46 
23 April 2012 
 (12-2169) 
Committee on Subsidies and 
Countervailing Measures Original:   English 
 
 
 
SUBSIDIES 
 
Replies to Questions from the EUROPEAN UNION1 Regarding the  
New and Full Notification of the REPUBLIC OF KOREA2 
   The following communication, dated 20 April 2012,  is being circulated at the request of the 
Delegation of Korea. 
 
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Under section III "Fishery", Korea is notifyin g a number of subsidy programmes that include 
the provision of loans to operators at rates set by the Korean authorities, in particular the 
following programmes:  III. B. Support for Fi sh Products Processing Development, III. C. 
Support for Fishing Activities, III. D.  Support fo r Aquaculture Fishery Development, III. E.  
Support for Old Fishing Vessels and Equipment Replacement.  
 Question 1   What are the conditions attached to th e loans provided under the above mentioned 
programmes as regards the loan guarantees and/or  collaterals?  What happens if operators are 
not in a position to reimburse the loan (princ ipal and/or interest)?  Do the same conditions 
apply across all programmes? 
 
Reply 
 
 The Korean government does not provide any guideline as regards loan guarantees and/or 
collaterals concerning the administration of the above mentioned programs.  The loans by the 
programs are administered by the fisheries cooperatives which function as a bank.  And terms and conditions as regards loan guarantees and/or collaterals are also set by the fisheries cooperatives.  
They are then responsible to ensure that principa ls and interests are fully repaid under the terms and 
conditions of the loans which are generally set on an individual basis as each applicant poses a 
different credit risk to the lender.  
                                                      
1 G/SCM/Q2/KOR/42.   
2 G/SCM/N/220/KOR. G/SCM/Q2/KOR/46 
Page 2  
 
  Under the section IV COAL Industry, Title of  the subsidy programme:  Coal Industry Support 
in the special account  for Energy and Resources 
 
Question 2 
 
 Please provide information about the volume and value of coal and briquette exported 
during the period of the subsidy.  
 
Reply 
 
 No export is recorded during the period of the subsidy.  
 
Under the section V.  Manufacturing Industry, A.  Support for Foreign Invested Enterprises, 
Title of the subsidy programme:  Suppo rt for Foreign-Invested Enterprises 
 
Question 3  
 
 Please cite the terms for a foreign-invested en terprise to operate within the FIZ, Free 
Economic Zone, Free Trade Zone, Industrial Comp lex Exclusively for Foreign Companies, Jeju 
Investment Promotion Zone and Developm ent District of Enterprise New Town. 
 Reply 
 
 Please refer to Web Site below :  
 FIZ, FEZ, FTZ:   
http://www.investkorea.org/InvestKoreaWar /work/ik/eng/bo/bo_01.jsp?code=102041804  
 
 Industrial Complex Exclusively for Foreign Companies: 
http://www.investkorea.org/InvestKoreaWar /work/ik/eng/bo/bo_01.jsp?code=102041507  
 
 Jeju Investment Promotion Zone: 
"http://www.investkorea.or.kr/InvestKoreaWar/work/reg/eng/co/index.jsp?l_unit=90202&m_
unit=90308&code=137050601&category=1 " 
 
 Development District of Enterprise New Town: 
http://enterprisecity.moct. go.kr/eng/produres.jsp  
 
Question 4 
  What is the required minimum of investment?  What kind of projects are eligible?  
Please provide detailed information about the crit erion of performance, on the basis of which 
the grants are awarded. 
 
Reply 
 
 Minimum investment:  at least 30 per cent of the investment must be FDI. 
 Eligible projects 
 Businesses involving advanced technology a nd services that support other industries;  
 High value-added parts and materials manufacturing;  
 Investments that generate massive jobs;  
 R&D businesses that create at least five jobs;    G/SCM/Q2/KOR/46 
 Page 3 
 
 
   Documentation required 
 Records concerning the purchase or rental of land;  
 Records concerning employment and the number of trainees;  
 Records showing the amount of investment delivered on plan.  
 
Question 5 
  Please provide information about the certain disadvantaged regions concerned, along 
with the certain criteria measured, the figures of these criteria and the period of measurements, 
according to which these regions a re considered as disadvantaged.  
 
Reply 
 
"Disadvantaged regions" are not prescribed in th e Act so no specific criteria are necessary to 
decide the regions.  In general, the programme  is designed to provide incentives to certain 
corporations that wish to enter "the non-metropo litan regions".  In the process of deciding the 
incentives and selecting certain corporations of all applicants in the regions, the government should 
consider following standards and qualifications to be applied. 
 
 Whether the business is involved in the transfer of valuable technology;  
 How many jobs the business creates;  
 Whether the investment duplicates any domestic investments;  
 Whether the investment benefits a disadvantaged region of the country.  
 
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